Citigroup (NYSE: C) and American International Group (NYSE: AIG) have already taken about $496 billion in U.S. cash and guarantees to keep them from failing. This makes me wonder: Is there no way to allow them to simply fail without causing the entire global financial system to collapse? And if not, is there a limit to how much more taxpayer money we pour into them before we say "no more"? The answers: Maybe and Yes.

Citi looks to be a basket case after $345 billion in taxpayer bailouts. It has already gotten $45 billion in cash -- $25 billion of which was recently converted from preferred to common -- and $301 billion in guarantees of its toxic assets. The U.S. now owns 36% of the common stock of Citi -- which lost $27.7 billion in 2008 and has a market capitalization -- Citi common shares times price per share -- of $8.2 billion.

Bloomberg News reports that Moody's (NYSE: MCO) may downgrade municipal bond insurer MBIA (NYSE: MBI) after it reported deepening losses from the mortgage-market slump. MBIA's insurance financial strength rating may fall to the Aa range, although a drop to the A category is possible. MBIA's stock is down 91% since the end of May 2007.

That's when I first suggested that investors consider selling MBIA shares short. William Ackman had already shorted MBIA because he thought it lacked the capital needed to support its obligations. Back then, MBIA traded at $66.59 a share -- today it's down to $5.88. His bet proved prescient.

Meanwhile, investors are wagering that MBIA won't make it. Credit-default swaps tied to MBIA's insurance unit rose to a record as investors hedged against the risk the company's guarantees will sour. Sellers of five-year contracts demanded 23% upfront and 5% a year. That's up from 18.5% initially and 5% a year yesterday.

Only $5.88 more to go.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in MBIA securities.

With consumer credit tightening this year in the fallout from subprime mortgage meltdown, are more Americans falling behind on their credit card payments? Yes they are, as the "cash machine" mentality many consumers isn't jiving with the "must make minimum payment" moniker those crazy pieces of plastic come with.

Did you know that a $6,000 credit card balance with a revolving credit line can run a minimum payment of about $200 per month? Quite a bit, isn't it? And that's below the average credit card debt load in this country. With less access to cash, cost of living increases and goofy financial decisions, those credit card payments are becoming a lower priority of borrowers. After all, that's what credit is -- borrowing. Did you just charge that flat-panel TV? You're actually borrowing it from your credit card company in a manner of speaking. Nice, eh?

The Associated Press report also said that the largest increase in past-due credit card payments were those that were 90 days in arrears already. If you think the mortgage loan default and term reset problem was bad in 2007, it will only continue into 2008. Perhaps the serial borrowing American will learn a hard financial lesson this year. And then, perhaps they can get back to paying those credit card payments on time and in good fashion.